Volkswacht Bodensee - German exports rise despite Iran war headwinds

Exports rose 0.9 percent from the previous month to 137.9 billion euros ($158 billion), according to preliminary data from statistics agency Destatis, driven by a rise in demand from the United States and China.

Analysts surveyed by financial data firm FactSet had expected a decline of one percent.

It was the latest evidence that Germany's long-struggling economy is coping with the turmoil unleashed by the US-Israeli war against Iran better than some had feared.

Figures released earlier this week showed German industrial output and orders also increased in May.

"These are encouraging signals for the German economy, even if certain sectors are still facing a deep crisis," Chancellor Friedrich Merz told parliament on Thursday.

The trade data released Thursday showed that the primary destination for German exports remained the United States, to the tune of 14.1 billion euros, a rise of 23.1 percent month-on-month.

Exports to China were also up 7.1 percent to reach 6.2 billion euros.

However, exports to other EU states fell by 1.1 percent, with imports from the rest of the bloc also down 2.5 percent.

Imports in May fell by 2.5 percent to 118.8 billion euros, meaning that the country's trade surplus rose to 19.1 billion euros.

The Iran war has dimmed prospects for a strong rebound in Germany's economy this year, with the government now expecting growth of just 0.5 percent.

I.Stoeckli--VB